TMI Blog2008 (7) TMI 377X X X X Extracts X X X X X X X X Extracts X X X X ..... lease. – Credit allowed to be transferred. - E/810/2006-MAS and 157/2008-MAS - 1278-1279/2008 - Dated:- 16-7-2008 - S/Shri P.G. Chacko, Member (J) and P. Karthikeyan, Member (T) Shri G. Natarajan, Advocate, for the Appellant. Smt R. Bhagya Devi, SDR, for the Respondent. [Order per : P. Karthikeyan, Member (T)].- Issues concerning eligibility to Cenvat credit of GTN Exports Ltd. (GTN), an EOU, which had been a DTA unit up to 19-11-04 are the subject matter of the following appeals. 2. GTN manufactures valve assembly parts falling under Chapter Heading 8481. It became an EOU on 19-11-04. The original authority had denied Cenvat credit balance of Rs. 11,07,017/- as there was no stock on 19-11-04 of inputs received by GTN ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. Following the remand in Order-in-Appeal No. 92/06, in de novo proceedings, Joint Commissioner found that there was no stock on 19-11-04 of credit availed goods received between 6-9-04 and 18-11-04 and decided the EOU to be not qualified for credit balance, as goods claimed by them to be available on 19-11-04 and ordered as admissible in the remand order were not available. He demanded the same Rs. 11,07,017/- as inadmissible Cenvat credit in the de nova order. He imposed penalty of Rs. three lakhs and dropped demand on inputs removed as he found that GTN had reversed the credit taken initially, on removal. 5. In Order-in-Appeal No. 109/2007 CE, dated 19-12-2007, Commissioner (A) found that as per Order-in-Appeal No. 92/06, credit w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s removed. EOUs could avail credit even earlier. The order to the contrary in the order-in-appeal was incorrect. They relied on Waterbase Ltd. v. CCE - 2005 (187) E.L.T. 346. 7. Rule 10 of CCR '04 allowing credit balance in specified situations did not cover conversion of a DTA unit to EOU as there was no shifting of factory or change in ownership or sale, merger or amalgamation or lease in the instant case. The original authority denied the credit balance relying on the above rule wrongly. He had also relied on Circular No. 54/2004-Cus., dated 13-11-04 wrongly. As per Notification No. 5/06-C.E. (N.T.), dated 14-3-06, refund of unutilized credit could be sanctioned. This Notification allowed EOUs to make monthly claims for refund. C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the balance credit at the time of conversion of DTA. Rule 10 of CCR 04 dealt with transitional credit in situations such as shifting of factory or change in ownership or sale, merger or amalgamation or lease. The claim of the appellant that the credit balance available related to inputs received on or after 6-9-04 is not contested. In any case, no provisions prohibited an EOU from availing balance of credit when the unit converted to EOU from DTA. EOU also manufactured goods for DTA clearances. Therefore GTN claim in this regard is correct. As regards the second issue, the Commissioner (A) ordered that the appellant was required to reverse the credit originally availed when the inputs were removed as such. We find the order to be in ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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